A widely followed gauge of fear and volatility on Wall Street spiked in Thursday, underscoring a sudden pickup of worry amid hand-wringing over President Donald Trump, a reported terror attack in Spain and concerns about sluggish inflation. The CBOE Volatility Index traded up about 32.5% at 15.55. The index, which tracks options bets on the S&P 500 index 30-days in the future typically moves inversely to stocks and is viewed as a gauge of the market's wager on pullbacks in the market, because equities tend to fall faster than they rise. Thursday's climb in the so-called fear gauge, also known as the VIX, coincided with a nearly 300-point tumble in the Dow Jones Industrial Average and a sharp retreat in the S&P 500 index . Stock investors have been shaken by uncertainty around President Trump's ability to get through his business-friendly legislative reforms after a trove of Wall Street leaders defected from key presidential advisory committees resulting in their disbanding altogether on Wednesday in reaction to the president's response to a weekend white-supremacist rally in Charlotesville, Va., that resulted in the death of Heather Heyer. The downdraft in the market also comes as a terror attack was being reported by local officials in Barcelona, where at least 13 people were reported dead as well as 50 injured. Concerns about the Fed's acknowledgement that tepid inflation is raising concerns that the economy isn't firing on all cylinders helped to deflate sentiment. Earlier in the week, the market been enjoying a slight updraft after last week's rough patch. In jeopardy is a four-session rally for the Dow industrials. More broadly, the yield on the 10-year Treasury note was down at 2.19%, with prices rising and yields falling, while haven gold was settled up 0.7% at $1,292.40 an ounce. Those assets tend to rise when investors adopt a more "risk off" posture, dumping assets perceived as risky in times of uncertainty. The Dow ended down 274 points, or 1.2%, at 21,750, the S&P 500 closed off by 1.5% at 2,430, while the Nasdaq Composite closed 1.9% lower at 6,221. Concerns about equity valuations also have made stocks more vulnerable to pullbacks, market participants said.
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